Durable goods orders up slightly in August, reversing deep drop

WASHINGTON -- Orders for long-lasting durable goods, such as airplanes, appliances and computers, increased slightly in August, reversing a steep drop the previous month that raised alarm about economic growth.

New orders increased by $300 million, or 0.1% in August compared with the previous month, the Commerce Department said Wednesday. Orders plunged a downwardly revised 8.1% in July in what was a bad sign for the coming months in the crucial manufacturing sector.

The August figures beat economist expectations of a 0.5% drop last month. It marked the fourth increase in five months in an important indicator of future growth.

The July drop was caused by a 58.9% decline in new orders for civilian aircraft and parts. That sector saw a much lower decline in August, just 1.2%.

Transportation orders are volatile, and durable-goods figures can have large month-to-month swings based on the flow of business at Boeing Corp.

Factoring out transportation, durable-goods orders dropped by 0.1% in August. Economists polled by Bloomberg had expected a 1% rise.

Orders for computers and related products bounced back last month, increasing 7.8% after a 13.5% drop the previous month. Motor vehicle and parts orders also improved, up 2.4% last month after a 0.4% increase in July.

In an important sign of business investment, orders for non-defense capital goods, excluding aircraft, increased 1.5% in August. Those orders had dropped 3.3% in July.